Global financial app Revolut is rolling out a “responsible” buy now, pay later (BNPL) product, called ‘Pay Later’, which will allow consumers to spread the cost of purchases up to €499 across three instalments.
The new responsible instalments payment product will initially be available to a select group of Revolut customers in Ireland, before rolling out to all customers in the country, where 1.9 million people have a Revolut account.
Revolut intends to make Pay Later available in additional markets from the end of 2022, and has earmarked Poland and Romania as the next markets gaining access to the product later this year.
Pay Later is designed to focus on “responsible credit and affordability”, according to Revolut, by allowing customers to spread the cost of a purchase across three monthly instalments, with the first instalment paid upfront at the time of purchase.
A fee of 1.65% per purchase is repaid as part of the final two instalments and there are no additional fees charged for making early repayments.
Customers can view their Pay Later balance in the cards section of the Revolut app, and in the Pay Later hub.
Revolut’s BNPL product differs from other offerings in that merchants do not sign up to Revolut Pay Later, and Revolut does not charge them for Pay Later transactions.
Joe Heneghan, CEO of Revolut Europe, said: “Revolut Pay Later gives our customers more control and flexibility over their personal finances, in a responsible way, by enabling them to spread the cost of purchases over three instalments.
“This encourages people to pay within two months, rather than calling on overdrafts and credit cards which don’t carry the same emphasis on quickly paying back the amount borrowed.”
Another feature of Pay Later is that each customer has their own bespoke credit limit up to €499, following a credit assessment carried out by Revolut, which checks affordability by linking to customers’ existing bank accounts through Open Banking.
Open Banking Expo’s BNPL Symposium takes place on 12 July in London – click here to find out more about agenda and register.